25 January 2021 � ILO Monitor: COVID-19 and the world of work. Seventh edition Updated estimates and analysis Key messages Latest labour market developments Workplace closures � The share of workers living in countries with COVID-19‑related restrictions has remained high, with 93 per cent of the world’s workers residing in countries with some form of workplace closure measures in place in early January 2021. Within countries, more geographically targeted and sector-specific measures have gradually become the norm over the course of the pandemic, and these were still affecting 77 per cent of workers at the start of the year (close to the peak of 85 per cent reached in late July 2020). Working-hour losses in 2020 � New annual estimates confirm that labour markets around the world were disrupted in 2020 on a historically unprecedented scale. 1 Assuming a 48-hour working week. See Technical Annex 1 for more details on the use of full-time equivalent jobs in these estimates. Employment losses are transformed into working hours using the actual number of hours worked, while FTE estimates use 48-hour working weeks. In 2020, 8.8 per cent of global working hours were lost relative to the fourth quarter of 2019, equivalent to 255 million full-time jobs. 1 Working‑hour losses were particularly high in Latin America and the Caribbean, Southern Europe and Southern Asia. Working-hour losses in 2020 were approximately four times greater than during the global financial crisis in 2009. � Breaking down these annual figures, revised quarterly estimates reveal how the situation evolved throughout the year. Estimates of working-hour losses in the third quarter of 2020 have been revised substantially downwards to 7.2 per cent (from 12.1 per cent in the sixth edition of the ILO Monitor), reflecting a stronger-than-expected rebound in working hours, especially in lower-middle- income countries. In the fourth quarter, global working hours declined by 4.6 per cent, equivalent to 130 million full-time jobs. Shift to unemployment 33 million Employment loss 114 million ≈ 50% of total working‑hour losses Shift to inactivity 81 million Working-hour losses in 2020 Working-hour reduction within employment ≈ 50% of total working‑hour losses 8.8% 255 million FTE* Labour income loss (before income support) (US$3.7 trillion, or 4.4% of 2019 GDP) 2020 quarterly Working-hour losses: quarterly trends in 2020 and projections for 2021 Working-hour, employment and labour income losses in 2020 2021 projection Q1 Q2 Q3 Q4 Baseline Optimistic Pessimistic % 5.2 18.2 7.2 4.6 3.0 1.3 4.6 FTE* (million) 150 525 205 130 90 36 130 * FTE: Full‑time equivalent jobs (assuming a 48‑hour working week) Figure 1. Estimates of the working hours, employment and labour income lost in 2020, and projections for 2021
COVID-19 and the world of work. Seventh edition
May 07, 2022
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25 January 2021
ILO Monitor: COVID-19 and the world of work. Seventh edition Updated estimates and analysis
Key messages
Latest labour market developments Workplace closures The share of workers living in countries with
COVID-19related restrictions has remained high, with 93 per cent of the world’s workers residing in countries with some form of workplace closure measures in place in early January 2021. Within countries, more geographically targeted and sector-specific measures have gradually become the norm over the course of the pandemic, and these were still affecting 77 per cent of workers at the start of the year (close to the peak of 85 per cent reached in late July 2020).
Working-hour losses in 2020 New annual estimates confirm that labour markets
around the world were disrupted in 2020 on a historically unprecedented scale.
1 Assuming a 48-hour working week. See Technical Annex 1 for more details on the use of full-time equivalent jobs in these estimates. Employment losses are transformed into working hours using the actual number of hours worked, while FTE estimates use 48-hour working weeks.
In 2020, 8.8 per cent of global working hours were lost relative to the fourth quarter of 2019, equivalent to 255 million full-time jobs.1 Workinghour losses were particularly high in Latin America and the Caribbean, Southern Europe and Southern Asia. Working-hour losses in 2020 were approximately four times greater than during the global financial crisis in 2009.
Breaking down these annual figures, revised quarterly estimates reveal how the situation evolved throughout the year. Estimates of working-hour losses in the third quarter of 2020 have been revised substantially downwards to 7.2 per cent (from 12.1 per cent in the sixth edition of the ILO Monitor), reflecting a stronger-than-expected rebound in working hours, especially in lower-middle- income countries. In the fourth quarter, global working hours declined by 4.6 per cent, equivalent to 130 million full-time jobs.
Shift to unemployment 33 millionEmployment loss
114 million ≈ 50% of total workinghour losses
Shift to inactivity 81 million
Working-hour losses in 2020 Working-hour reduction within employment
≈ 50% of total workinghour losses8.8% 255 million FTE*
Labour income loss (before income support) (US$3.7 trillion, or 4.4% of 2019 GDP)
2020 quarterly
Working-hour losses: quarterly trends in 2020 and projections for 2021
Working-hour, employment and labour income losses in 2020
2021 projection Q1 Q2 Q3 Q4 Baseline Optimistic Pessimistic
% 5.2 18.2 7.2 4.6 3.0 1.3 4.6 FTE* (million) 150 525 205 130 90 36 130 * FTE: Fulltime equivalent jobs (assuming a 48hour working week)
Figure 1. Estimates of the working hours, employment and labour income lost in 2020, and projections for 2021
2 ILO Monitor: COVID-19 and the world of work. Seventh edition
Employment, unemployment and inactivity Globally, the decline in working hours in 2020
translated into both employment losses and a reduction in working hours for those who remained employed, with significant variation across regions. Employment losses were highest in the Americas, and lowest in Europe and Central Asia, where job retention schemes have supported the reduction in working hours, especially in Europe. In total, there were unprecedented global employment losses in 2020 of 114 million jobs relative to 2019. In relative terms, employment losses were higher for women (5.0 per cent) than for men, and for young workers (8.7 per cent) than for older workers.
Employment losses in 2020 translated mainly into rising inactivity rather than unemployment. Accounting for 71 per cent of global employment losses, inactivity increased by 81 million,2 which resulted in a reduction of the global labour force participation rate by 2.2 percentage points in 2020 to 58.7 per cent. Global unemployment increased by 33 million in 2020, with the unemployment rate rising by 1.1 percentage points to 6.5 per cent.
Labour income losses Global labour income (before taking into
account income support measures) in 2020 is estimated to have declined by 8.3 per cent, which amounts to US$3.7 trillion, or 4.4 per cent of global gross domestic product (GDP).3 The largest labour income loss was experienced by workers in the Americas (10.3 per cent), while the smallest loss was registered in Asia and the Pacific (6.6 per cent).
Projections for 2021 While there are expectations that a robust
economic recovery will occur in the second half of 2021 with the rollout of vaccination against COVID-19, the global economy is still facing high levels of uncertainty and there is a risk that the recovery will be uneven. The latest projections indicate a persistent work deficit in 2021. Drawing
2 This is over and above the increase in inactivity due to the growth of the working-age population, which amounted to an additional 73 million inactive people in 2020.
3 Global GDP in 2019 using 2019 market exchange rates.
on, inter alia, the International Monetary Fund (IMF)’s economic forecasts from October 2020, the baseline scenario projects a continued loss in working hours of 3.0 per cent in 2021 relative to the fourth quarter of 2019, which corresponds to 90 million full-time equivalent (FTE) jobs. In the pessimistic scenario, workinghour losses in 2021 will remain at 4.6 per cent, or 130 million FTE jobs, relative to the fourth quarter of 2019. Even in the optimistic scenario, which assumes more favourable conditions, a loss of 1.3 per cent of global working hours (or 36 million FTE jobs) is still expected in 2021 relative to the fourth quarter of 2019.
Disproportionate impact and uneven recovery
The latest labour force survey data (up to the third quarter of 2020) reveal the contrast between massive job losses in hard-hit sectors (such as accommodation and food services, arts and culture, retail, and construction) and the positive job growth evident in a number of higher- skilled services sectors (such as information and communication, and financial and insurance activities). This divergence will tend to increase inequality within countries. At the same time, there is considerable variation across countries with regard to the severity of the impact of the crisis on jobs in the hardest-hit sectors.
Similarly, evidence from available country data shows that the impact of the crisis on “post-support labour income” (which includes the income support received by workers) was uneven across different parts of the workforce, although income support measures have mitigated the impact. Overall, losses in post-support labour income were relatively larger for young workers, women, the self-employed, and low- and medium-skilled workers. Often, job destruction has disproportionately affected low-paid and low-skilled jobs. All this points to the risk of an uneven recovery, leading to still greater inequality in the coming years.
3 ILO Monitor: COVID-19 and the world of work. Seventh edition
Looking ahead: Supporting a human-centred recovery
The world enters 2021 still facing an unprecedented crisis in jobs and incomes and heightened levels of uncertainty. Over the year, policy responses will need to combine the roll-out of vaccination, public health measures, and supporting measures for the economy and the labour market. Policymakers should strive to support a recovery that is robust and broad-based, focusing on employment, income, workers’ rights and social dialogue: a human-centred recovery.
4 In recent weeks, though, the number of COVID-19 cases has risen in certain countries in Asia and the Pacific, which may potentially point to a second wave of the pandemic occurring there.
To that end, policymakers need to consider: (a) maintaining an accommodative macroeconomic policy for income support and investment; (b) assisting low- and middle-income countries with vaccination and policy measures; (c) ensuring that hard-hit groups (notably young people, women, the lowpaid and lowskilled workers) are supported in finding decent work opportunities and that they do not suffer any long-term “scarring effects”; (d) balancing the needs of the diverging sectors, with effective policy measures to support workers’ labour market transitions as well as enterprises (particularly smaller firms); and (e) implementing recovery strategies, based on social dialogue, that promote a transition to a more inclusive, resilient and sustainable world of work.
Part I. Latest labour market developments in 2020 and predictions for 2021: Modest recovery with high uncertainty
Workplace closures
The number of workers living in countries with COVID-19-related workplace restrictions remained high at the start of 2021, with 93 per cent of the world’s workers residing in countries with some form of workplace closures in place (figure 2). Within countries, more geographically targeted and sector specific measures have gradually become the norm over the course of the pandemic. Thus, fewer than 3 per cent of the world’s workers are currently living in countries with economywide required closures for all but essential workplaces, down from a peak of 41 per cent in April 2020. A further 11 per cent of workers reside in countries with nationwide closures for some sectors or categories of workers, down from more than 30 per cent in late September. At 77 per cent, the share of workers living in countries with required closures in geographically targeted areas or for specific sectors remains close to the peak of 85 per cent reached in late July.
Trends in workplace closures vary considerably across the world’s main regions. With a second wave of the
pandemic sweeping across Europe in the second half of 2020, the Europe and Central Asia region has seen a marked increase in restrictions. At the start of 2021, 20 per cent of workers in the region were living in countries with economywide closures for all but essential workers – the highest share among the five major regions of the world. This was driven by a sharp increase in restrictions in Northern, Southern and Western Europe beginning in December: nearly 40 per cent of workers in that subregion are currently living in countries with required closures for all but essential workplaces.
Restrictions in Asia and the Pacific continue to be widespread, with over 90 per cent of workers in that region living in countries with some form of workplace closure measures in place. However, in line with the global trend, the measures have become more geographically targeted and only a small share of workers are affected by economy-wide restrictions.4
All other major regions have seen a gradual softening of measures. Around half of the workers in the Arab States region currently reside in countries with COVID-19-related workplace restrictions, down from a peak of nearly 100 per cent between April
4 ILO Monitor: COVID-19 and the world of work. Seventh edition
and June 2020. Approximately one in five workers in Africa reside in countries with required workplace closures, down from a peak of around four in five in April. Most measures currently in place in the region target specific sectors or geographical areas within countries. In the Americas, the share of workers living in countries with some form of workplace closure measures in place remains close to 90 per cent. However, nearly all restrictions are targeted at certain geographical areas or sectors, indicating a general easing of the situation there too.
A number of factors, including a better understanding of how containment measures help to control the spread of the virus, have driven the changing nature of workplace closures. Governments have recognized that geographically targeted and sector specific measures are more acceptable to people, as they
reduce the economic impact. In developing countries, limited fiscal space and other policy constraints made difficult choices necessary in 2020, and most of these economies have now moved away from hard lockdowns. Nevertheless, as the health risks remain high, striking an appropriate balance between public health measures and support for workers and enterprises affected by workplace closures remains key to mitigating both the immediate and longterm impact of the pandemic on the world of work. Even in countries with less stringent measures, economic activity has been affected because of physical distancing and global spillover effects, such as the sharp reduction in tourism and the persistent barriers to migration. Tourism and migration are both critical to the functioning of many developing and emerging economies.
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec Jan 2021
0
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20%
30%
40%
50%
60%
70%
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90%
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5 Required closures for all but essential workplaces – total economy 4 Required closures for all but essential workplaces – targeted areas only 3 Required closures for some sectors or categories of workers – total economy 2 Required closures for some sectors or categories of workers – targeted areas only 1 Recommended closures
2020
Figure 2. Share of world’s employed in countries with workplace closures, January 2020 – January 2021 (percentage)
Note: The shares of workers in countries with required workplace closures for some sectors or categories of workers and countries with recommended workplace closures are stacked on top of the share of workers in countries with required workplace closures for all but essential workplaces.
Source: ILOSTAT database, ILO modelled estimates and the Oxford COVID-19 Government Response Tracker.
5 ILO Monitor: COVID-19 and the world of work. Seventh edition
Unprecedented global working-hour losses throughout 2020, with an uneven and modest recovery
Unprecedented global working-hour losses in 2020 In terms of the pandemic’s overall impact in 2020, the new ILO annual estimates confirm that it caused massive disruptions in the world of work. In 2020, 8.8 per cent of global working hours were lost relative to the fourth quarter of 2019, equivalent to 255 million full-time jobs5 (assuming a 48hour working week). These losses were global and unprecedented.
While the disruption was global, there was substantial variation between regions (figure 3). Workinghour losses in 2020 were particularly large
5 See Technical Annex 1 for more details on the use of full-time equivalent jobs in these estimates.
6 These averages, which refer to all people aged 15 to 64 years, are not comparable to the full-time equivalent (FTE-48) estimates presented elsewhere in this edition of the ILO Monitor. The FTE-48 estimates refer only to employed people aged 15 and above.
in Latin America and the Caribbean, Southern Europe and Southern Asia. In contrast, Eastern Asia and Central, Western and Eastern Africa experienced relatively smaller workinghour losses, reflecting less stringent lockdown measures in these subregions.
The labour market disruption in 2020 far exceeded the impact of the global financial crisis of 2009. Over the 15 years before the onset of the COVID-19 pandemic, the average hours worked per person of working age (aged 15 to 64) fluctuated between 27 and 28 hours per week. This then dropped sharply by 2.5 hours from 27.2 hours per week in 2019 to 24.7 hours per week in 2020 (figure 4).6 In contrast, when the global financial crisis hit the labour market, average working hours declined by just 0.6 hours between 2008 and 2009. The effect of the COVID-19 shock on global working hours has therefore been approximately four times greater than that of the global financial crisis.
0% 27%
Figure 3. Working hours lost around the world in 2020 relative to the fourth quarter of 2019 (percentage)
Source: ILO nowcasting model (see Technical Annex 1).
6 ILO Monitor: COVID-19 and the world of work. Seventh edition
Trends in 2020: Updated quarterly estimates The quarterly estimates reflect the volatility in working hours during the pandemic (figure 5). Half of the total loss of working hours in 2020 occurred during the second quarter of the year. During the first quarter of 2020, an estimated 5.2 per cent of global working hours (down from
5.6 per cent as estimated previously) were lost relative to the fourth quarter of 2019, equivalent to 150 million full-time jobs (assuming a 48-hour working week). The implementation of strict containment measures worldwide caused working hour losses to peak in the second quarter of 2020, the estimated decline being 18.2 per cent (up from the previous estimate of 17.3 per cent), equivalent to 525 million full-time jobs.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 *2019 Q1 Q2 Q3 Q4 22.0 22.5 23.0 23.5 24.0 24.5 25.0 25.5 26.0 26.5 27.0 27.5 28.0 28.5 29.0
2020 – quarterly
World 8.8 5.2 18.2 7.2 4.6
Low-income countries 6.7 2.5 13.4 7.6 3.3
Lower-middle-income countries 11.3 2.5 29.0 9.3 4.5
Upper-middle-income countries 7.3 8.4 11.5 5.6 3.9
High-income countries 8.3 3.0 15.8 7.3 7.0
Figure 4. Hours worked per person in the working-age population (aged 15 to 64), world, 2005–20
Figure 5. Working-hour losses, world and by income group, 2020 total and quarterly estimates (percentage)
Note: Annual average.
Source: ILO modelled estimates based on the ILO nowcasting model (see Technical Annex 1).
Source: ILO nowcasting model (see Technical Annex 1).
7 ILO Monitor: COVID-19 and the world of work. Seventh edition
The estimates for the third quarter have been revised substantially downwards7 to 7.2 per cent, almost 5 percentage points less than the previous estimate of 12.1 per cent. This revision is due to new data suggesting a strong rebound effect across all country income groups, but with particular intensity in lowermiddleincome countries, where containment measures became less stringent and economic activities resumed quickly. Global working-hour losses during the third quarter were equivalent to 205 million full-time jobs, pointing to the persistence of severe labour market disruption.
Working-hour losses for the fourth quarter of 2020 are estimated at 4.6 per cent, equivalent to 130 million full-time jobs, relative to the pre-crisis baseline (fourth quarter of 2019). This loss is smaller than the projections presented in the previous edition of the ILO Monitor (8.6 per cent in the baseline scenario and 5.7 per cent in the optimistic scenario). This more positive trend is a consequence of the strong rebound in the third quarter of 2020. The pace of recovery during the fourth quarter is estimated to have been modest.
The latest ILO estimates indicate that developing countries, which suffered sharp contractions in working hours, have tended to experience strong rebounds (for regional findings, see table A1 in the Statistical annex). At the same time, in countries going through a “second wave” of restrictions – mainly high- income countries – working-hour losses are estimated to be considerably smaller than during the “first wave”. During 2020, lower-middle-income countries experienced the greatest losses in working hours,
7 As noted in the previous edition of the ILO Monitor, the uncertainty associated with the third quarter is considerable because of data limitations.
8 Care should be taken when interpreting this finding, as no labour force survey data are available for countries in the low-income group (see Technical Annex 1 for details of the estimation process).
9 The relatively lower working-hour losses in low-income countries may reflect the greater importance of informal and agricultural employment and the fact that most people there need to work in order to survive. Additionally, while low-income countries acted swiftly to close their borders and implement public health restrictions in the second quarter of 2020, they subsequently lifted them more quickly than wealthier countries.
10 See the ILOSTAT portal for detailed definitions of key terms: https://ilostat.ilo.org/resources/concepts-and-definitions/.
which stood at 11.3 per cent, well above the global average of 8.8 per cent. This was overwhelmingly driven by the stronger impact of the crisis on this country group during the second quarter (workinghour losses of 29.0 per cent, compared with a global average of 18.2 per cent) (figure 5). Upper-middle-income and high-income countries present similar working-hour losses (7.3 and 8.3 per cent, respectively) during 2020, albeit with considerable differences in quarterly trends. Finally, low-income countries experienced the lowest workinghour losses in 2020 of all income groups, at 6.7 per cent.8,9
Inactivity increased much more than unemployment
As explained in previous editions of the ILO Monitor, workinghour losses are composed of two dimensions of labour market adjustment (figure 6): employment losses and reduced working hours for those who remain employed (see Technical Annex 2 for further details). Workers who suffer a loss of employment find themselves either…
ILO Monitor: COVID-19 and the world of work. Seventh edition Updated estimates and analysis
Key messages
Latest labour market developments Workplace closures The share of workers living in countries with
COVID-19related restrictions has remained high, with 93 per cent of the world’s workers residing in countries with some form of workplace closure measures in place in early January 2021. Within countries, more geographically targeted and sector-specific measures have gradually become the norm over the course of the pandemic, and these were still affecting 77 per cent of workers at the start of the year (close to the peak of 85 per cent reached in late July 2020).
Working-hour losses in 2020 New annual estimates confirm that labour markets
around the world were disrupted in 2020 on a historically unprecedented scale.
1 Assuming a 48-hour working week. See Technical Annex 1 for more details on the use of full-time equivalent jobs in these estimates. Employment losses are transformed into working hours using the actual number of hours worked, while FTE estimates use 48-hour working weeks.
In 2020, 8.8 per cent of global working hours were lost relative to the fourth quarter of 2019, equivalent to 255 million full-time jobs.1 Workinghour losses were particularly high in Latin America and the Caribbean, Southern Europe and Southern Asia. Working-hour losses in 2020 were approximately four times greater than during the global financial crisis in 2009.
Breaking down these annual figures, revised quarterly estimates reveal how the situation evolved throughout the year. Estimates of working-hour losses in the third quarter of 2020 have been revised substantially downwards to 7.2 per cent (from 12.1 per cent in the sixth edition of the ILO Monitor), reflecting a stronger-than-expected rebound in working hours, especially in lower-middle- income countries. In the fourth quarter, global working hours declined by 4.6 per cent, equivalent to 130 million full-time jobs.
Shift to unemployment 33 millionEmployment loss
114 million ≈ 50% of total workinghour losses
Shift to inactivity 81 million
Working-hour losses in 2020 Working-hour reduction within employment
≈ 50% of total workinghour losses8.8% 255 million FTE*
Labour income loss (before income support) (US$3.7 trillion, or 4.4% of 2019 GDP)
2020 quarterly
Working-hour losses: quarterly trends in 2020 and projections for 2021
Working-hour, employment and labour income losses in 2020
2021 projection Q1 Q2 Q3 Q4 Baseline Optimistic Pessimistic
% 5.2 18.2 7.2 4.6 3.0 1.3 4.6 FTE* (million) 150 525 205 130 90 36 130 * FTE: Fulltime equivalent jobs (assuming a 48hour working week)
Figure 1. Estimates of the working hours, employment and labour income lost in 2020, and projections for 2021
2 ILO Monitor: COVID-19 and the world of work. Seventh edition
Employment, unemployment and inactivity Globally, the decline in working hours in 2020
translated into both employment losses and a reduction in working hours for those who remained employed, with significant variation across regions. Employment losses were highest in the Americas, and lowest in Europe and Central Asia, where job retention schemes have supported the reduction in working hours, especially in Europe. In total, there were unprecedented global employment losses in 2020 of 114 million jobs relative to 2019. In relative terms, employment losses were higher for women (5.0 per cent) than for men, and for young workers (8.7 per cent) than for older workers.
Employment losses in 2020 translated mainly into rising inactivity rather than unemployment. Accounting for 71 per cent of global employment losses, inactivity increased by 81 million,2 which resulted in a reduction of the global labour force participation rate by 2.2 percentage points in 2020 to 58.7 per cent. Global unemployment increased by 33 million in 2020, with the unemployment rate rising by 1.1 percentage points to 6.5 per cent.
Labour income losses Global labour income (before taking into
account income support measures) in 2020 is estimated to have declined by 8.3 per cent, which amounts to US$3.7 trillion, or 4.4 per cent of global gross domestic product (GDP).3 The largest labour income loss was experienced by workers in the Americas (10.3 per cent), while the smallest loss was registered in Asia and the Pacific (6.6 per cent).
Projections for 2021 While there are expectations that a robust
economic recovery will occur in the second half of 2021 with the rollout of vaccination against COVID-19, the global economy is still facing high levels of uncertainty and there is a risk that the recovery will be uneven. The latest projections indicate a persistent work deficit in 2021. Drawing
2 This is over and above the increase in inactivity due to the growth of the working-age population, which amounted to an additional 73 million inactive people in 2020.
3 Global GDP in 2019 using 2019 market exchange rates.
on, inter alia, the International Monetary Fund (IMF)’s economic forecasts from October 2020, the baseline scenario projects a continued loss in working hours of 3.0 per cent in 2021 relative to the fourth quarter of 2019, which corresponds to 90 million full-time equivalent (FTE) jobs. In the pessimistic scenario, workinghour losses in 2021 will remain at 4.6 per cent, or 130 million FTE jobs, relative to the fourth quarter of 2019. Even in the optimistic scenario, which assumes more favourable conditions, a loss of 1.3 per cent of global working hours (or 36 million FTE jobs) is still expected in 2021 relative to the fourth quarter of 2019.
Disproportionate impact and uneven recovery
The latest labour force survey data (up to the third quarter of 2020) reveal the contrast between massive job losses in hard-hit sectors (such as accommodation and food services, arts and culture, retail, and construction) and the positive job growth evident in a number of higher- skilled services sectors (such as information and communication, and financial and insurance activities). This divergence will tend to increase inequality within countries. At the same time, there is considerable variation across countries with regard to the severity of the impact of the crisis on jobs in the hardest-hit sectors.
Similarly, evidence from available country data shows that the impact of the crisis on “post-support labour income” (which includes the income support received by workers) was uneven across different parts of the workforce, although income support measures have mitigated the impact. Overall, losses in post-support labour income were relatively larger for young workers, women, the self-employed, and low- and medium-skilled workers. Often, job destruction has disproportionately affected low-paid and low-skilled jobs. All this points to the risk of an uneven recovery, leading to still greater inequality in the coming years.
3 ILO Monitor: COVID-19 and the world of work. Seventh edition
Looking ahead: Supporting a human-centred recovery
The world enters 2021 still facing an unprecedented crisis in jobs and incomes and heightened levels of uncertainty. Over the year, policy responses will need to combine the roll-out of vaccination, public health measures, and supporting measures for the economy and the labour market. Policymakers should strive to support a recovery that is robust and broad-based, focusing on employment, income, workers’ rights and social dialogue: a human-centred recovery.
4 In recent weeks, though, the number of COVID-19 cases has risen in certain countries in Asia and the Pacific, which may potentially point to a second wave of the pandemic occurring there.
To that end, policymakers need to consider: (a) maintaining an accommodative macroeconomic policy for income support and investment; (b) assisting low- and middle-income countries with vaccination and policy measures; (c) ensuring that hard-hit groups (notably young people, women, the lowpaid and lowskilled workers) are supported in finding decent work opportunities and that they do not suffer any long-term “scarring effects”; (d) balancing the needs of the diverging sectors, with effective policy measures to support workers’ labour market transitions as well as enterprises (particularly smaller firms); and (e) implementing recovery strategies, based on social dialogue, that promote a transition to a more inclusive, resilient and sustainable world of work.
Part I. Latest labour market developments in 2020 and predictions for 2021: Modest recovery with high uncertainty
Workplace closures
The number of workers living in countries with COVID-19-related workplace restrictions remained high at the start of 2021, with 93 per cent of the world’s workers residing in countries with some form of workplace closures in place (figure 2). Within countries, more geographically targeted and sector specific measures have gradually become the norm over the course of the pandemic. Thus, fewer than 3 per cent of the world’s workers are currently living in countries with economywide required closures for all but essential workplaces, down from a peak of 41 per cent in April 2020. A further 11 per cent of workers reside in countries with nationwide closures for some sectors or categories of workers, down from more than 30 per cent in late September. At 77 per cent, the share of workers living in countries with required closures in geographically targeted areas or for specific sectors remains close to the peak of 85 per cent reached in late July.
Trends in workplace closures vary considerably across the world’s main regions. With a second wave of the
pandemic sweeping across Europe in the second half of 2020, the Europe and Central Asia region has seen a marked increase in restrictions. At the start of 2021, 20 per cent of workers in the region were living in countries with economywide closures for all but essential workers – the highest share among the five major regions of the world. This was driven by a sharp increase in restrictions in Northern, Southern and Western Europe beginning in December: nearly 40 per cent of workers in that subregion are currently living in countries with required closures for all but essential workplaces.
Restrictions in Asia and the Pacific continue to be widespread, with over 90 per cent of workers in that region living in countries with some form of workplace closure measures in place. However, in line with the global trend, the measures have become more geographically targeted and only a small share of workers are affected by economy-wide restrictions.4
All other major regions have seen a gradual softening of measures. Around half of the workers in the Arab States region currently reside in countries with COVID-19-related workplace restrictions, down from a peak of nearly 100 per cent between April
4 ILO Monitor: COVID-19 and the world of work. Seventh edition
and June 2020. Approximately one in five workers in Africa reside in countries with required workplace closures, down from a peak of around four in five in April. Most measures currently in place in the region target specific sectors or geographical areas within countries. In the Americas, the share of workers living in countries with some form of workplace closure measures in place remains close to 90 per cent. However, nearly all restrictions are targeted at certain geographical areas or sectors, indicating a general easing of the situation there too.
A number of factors, including a better understanding of how containment measures help to control the spread of the virus, have driven the changing nature of workplace closures. Governments have recognized that geographically targeted and sector specific measures are more acceptable to people, as they
reduce the economic impact. In developing countries, limited fiscal space and other policy constraints made difficult choices necessary in 2020, and most of these economies have now moved away from hard lockdowns. Nevertheless, as the health risks remain high, striking an appropriate balance between public health measures and support for workers and enterprises affected by workplace closures remains key to mitigating both the immediate and longterm impact of the pandemic on the world of work. Even in countries with less stringent measures, economic activity has been affected because of physical distancing and global spillover effects, such as the sharp reduction in tourism and the persistent barriers to migration. Tourism and migration are both critical to the functioning of many developing and emerging economies.
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec Jan 2021
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5 Required closures for all but essential workplaces – total economy 4 Required closures for all but essential workplaces – targeted areas only 3 Required closures for some sectors or categories of workers – total economy 2 Required closures for some sectors or categories of workers – targeted areas only 1 Recommended closures
2020
Figure 2. Share of world’s employed in countries with workplace closures, January 2020 – January 2021 (percentage)
Note: The shares of workers in countries with required workplace closures for some sectors or categories of workers and countries with recommended workplace closures are stacked on top of the share of workers in countries with required workplace closures for all but essential workplaces.
Source: ILOSTAT database, ILO modelled estimates and the Oxford COVID-19 Government Response Tracker.
5 ILO Monitor: COVID-19 and the world of work. Seventh edition
Unprecedented global working-hour losses throughout 2020, with an uneven and modest recovery
Unprecedented global working-hour losses in 2020 In terms of the pandemic’s overall impact in 2020, the new ILO annual estimates confirm that it caused massive disruptions in the world of work. In 2020, 8.8 per cent of global working hours were lost relative to the fourth quarter of 2019, equivalent to 255 million full-time jobs5 (assuming a 48hour working week). These losses were global and unprecedented.
While the disruption was global, there was substantial variation between regions (figure 3). Workinghour losses in 2020 were particularly large
5 See Technical Annex 1 for more details on the use of full-time equivalent jobs in these estimates.
6 These averages, which refer to all people aged 15 to 64 years, are not comparable to the full-time equivalent (FTE-48) estimates presented elsewhere in this edition of the ILO Monitor. The FTE-48 estimates refer only to employed people aged 15 and above.
in Latin America and the Caribbean, Southern Europe and Southern Asia. In contrast, Eastern Asia and Central, Western and Eastern Africa experienced relatively smaller workinghour losses, reflecting less stringent lockdown measures in these subregions.
The labour market disruption in 2020 far exceeded the impact of the global financial crisis of 2009. Over the 15 years before the onset of the COVID-19 pandemic, the average hours worked per person of working age (aged 15 to 64) fluctuated between 27 and 28 hours per week. This then dropped sharply by 2.5 hours from 27.2 hours per week in 2019 to 24.7 hours per week in 2020 (figure 4).6 In contrast, when the global financial crisis hit the labour market, average working hours declined by just 0.6 hours between 2008 and 2009. The effect of the COVID-19 shock on global working hours has therefore been approximately four times greater than that of the global financial crisis.
0% 27%
Figure 3. Working hours lost around the world in 2020 relative to the fourth quarter of 2019 (percentage)
Source: ILO nowcasting model (see Technical Annex 1).
6 ILO Monitor: COVID-19 and the world of work. Seventh edition
Trends in 2020: Updated quarterly estimates The quarterly estimates reflect the volatility in working hours during the pandemic (figure 5). Half of the total loss of working hours in 2020 occurred during the second quarter of the year. During the first quarter of 2020, an estimated 5.2 per cent of global working hours (down from
5.6 per cent as estimated previously) were lost relative to the fourth quarter of 2019, equivalent to 150 million full-time jobs (assuming a 48-hour working week). The implementation of strict containment measures worldwide caused working hour losses to peak in the second quarter of 2020, the estimated decline being 18.2 per cent (up from the previous estimate of 17.3 per cent), equivalent to 525 million full-time jobs.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 *2019 Q1 Q2 Q3 Q4 22.0 22.5 23.0 23.5 24.0 24.5 25.0 25.5 26.0 26.5 27.0 27.5 28.0 28.5 29.0
2020 – quarterly
World 8.8 5.2 18.2 7.2 4.6
Low-income countries 6.7 2.5 13.4 7.6 3.3
Lower-middle-income countries 11.3 2.5 29.0 9.3 4.5
Upper-middle-income countries 7.3 8.4 11.5 5.6 3.9
High-income countries 8.3 3.0 15.8 7.3 7.0
Figure 4. Hours worked per person in the working-age population (aged 15 to 64), world, 2005–20
Figure 5. Working-hour losses, world and by income group, 2020 total and quarterly estimates (percentage)
Note: Annual average.
Source: ILO modelled estimates based on the ILO nowcasting model (see Technical Annex 1).
Source: ILO nowcasting model (see Technical Annex 1).
7 ILO Monitor: COVID-19 and the world of work. Seventh edition
The estimates for the third quarter have been revised substantially downwards7 to 7.2 per cent, almost 5 percentage points less than the previous estimate of 12.1 per cent. This revision is due to new data suggesting a strong rebound effect across all country income groups, but with particular intensity in lowermiddleincome countries, where containment measures became less stringent and economic activities resumed quickly. Global working-hour losses during the third quarter were equivalent to 205 million full-time jobs, pointing to the persistence of severe labour market disruption.
Working-hour losses for the fourth quarter of 2020 are estimated at 4.6 per cent, equivalent to 130 million full-time jobs, relative to the pre-crisis baseline (fourth quarter of 2019). This loss is smaller than the projections presented in the previous edition of the ILO Monitor (8.6 per cent in the baseline scenario and 5.7 per cent in the optimistic scenario). This more positive trend is a consequence of the strong rebound in the third quarter of 2020. The pace of recovery during the fourth quarter is estimated to have been modest.
The latest ILO estimates indicate that developing countries, which suffered sharp contractions in working hours, have tended to experience strong rebounds (for regional findings, see table A1 in the Statistical annex). At the same time, in countries going through a “second wave” of restrictions – mainly high- income countries – working-hour losses are estimated to be considerably smaller than during the “first wave”. During 2020, lower-middle-income countries experienced the greatest losses in working hours,
7 As noted in the previous edition of the ILO Monitor, the uncertainty associated with the third quarter is considerable because of data limitations.
8 Care should be taken when interpreting this finding, as no labour force survey data are available for countries in the low-income group (see Technical Annex 1 for details of the estimation process).
9 The relatively lower working-hour losses in low-income countries may reflect the greater importance of informal and agricultural employment and the fact that most people there need to work in order to survive. Additionally, while low-income countries acted swiftly to close their borders and implement public health restrictions in the second quarter of 2020, they subsequently lifted them more quickly than wealthier countries.
10 See the ILOSTAT portal for detailed definitions of key terms: https://ilostat.ilo.org/resources/concepts-and-definitions/.
which stood at 11.3 per cent, well above the global average of 8.8 per cent. This was overwhelmingly driven by the stronger impact of the crisis on this country group during the second quarter (workinghour losses of 29.0 per cent, compared with a global average of 18.2 per cent) (figure 5). Upper-middle-income and high-income countries present similar working-hour losses (7.3 and 8.3 per cent, respectively) during 2020, albeit with considerable differences in quarterly trends. Finally, low-income countries experienced the lowest workinghour losses in 2020 of all income groups, at 6.7 per cent.8,9
Inactivity increased much more than unemployment
As explained in previous editions of the ILO Monitor, workinghour losses are composed of two dimensions of labour market adjustment (figure 6): employment losses and reduced working hours for those who remain employed (see Technical Annex 2 for further details). Workers who suffer a loss of employment find themselves either…
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